How To Read A Credit Report

Credit reports from any of the major reporting companies show a history of your credit use over as much as a ten year period. A report begins with identifying information, including your name and social security number, current and former addresses. Next is a list of creditors and your payment history with them, and ratings of your credit use.

Look carefully at each part of your report and note any errors. Incorrect demographic information can make it impossible for your own report to be found. This can cause real problems when you apply for a loan, an insurance policy, or in some cases a job.

Creditors are listed by credit type, creditor name, and by account age, with open, current accounts shown first. The business name in the report may not be the same as the name it uses in business with you. Other information listed under the creditor includes the account number, how long the account has been open, the total amount of credit available to you, and your payment history for the past one month, three months, one year, and more. You might not find all creditors listed and information may be inaccurate.

Which creditors are included is important. Mortgages and car loans are telling indicators of how you manage large loan amounts over time with a fixed payment amount. Credit cards and other revolving credit show how much of the credit available to you is used as well as how consistently you pay. Landlords and utilities might report information to the credit bureaus, although many do not. Student loans will be listed.

Ratings of your credit use are particularly important. Using all of the credit available to you and having many new accounts or inquiries can damage your rating. Higher ratings mean you are a better risk and will both find it easier and less expensive to get additional credit. Low ratings may be the result of a poor or short payment history or having few creditors.


Everytime a bank or financer (credit company) accesses your credit report it counts as a hit.  One or two hits/year is not bad, but several hits in only a few months drops your credit score, as it looks like you are trying to get a lot of available credit.  Also, having a lot of credit cards can damage your score, even when you have low balances on them.  It's usually best to only have two cards and keep their balances in check.

Contact the credit bureau to correct any information that is incorrect on your report. Be sure that any closed accounts are reported as closed, the ages of accounts are accurate, and the amounts owed are current. Your report will explain the procedure for getting corrections made.You should check your credit report once a year to make sure the information is correct, and that no-one is creating debt in your name.